An important oenologist, listed on the board of directors of the Hong Kong Stock Exchange, is to acquire a majority stake in a Japanese cryptocurrency trading platform. The agreement is intended to "obtain a better return" to the shareholders of the company.
In search of diversification
Madison Holdings Group – a $ 534 million-listed winery listed on the Hong Kong Stock Exchange of the Hong Kong Stock Exchange is set to purchase a majority stake in the Japanese cryptocurrency BitOcean trading platform.
According to the release, Madison will purchase 67.2 percent of BitOcean from independent third parties for about $ 15.12 million, paying another $ 15 million in different fees. BitOcean is among the operators currently registered with the Japanese Financial Services Agency (FSA).
Speaking of this, Raymond Ting Pang-wan, president of Madison, said that the agreement is part of the company's diversification strategy:
Our wine business is stable and profitable, but then it is small. It is difficult to turn wine into a big business. This is why we need to diversify into financial technology and the cryptocurrency business – to achieve a better return for our shareholders.
It does not matter the falling prices
Despite the prolonged bear market 2018, which saw the price of Bitcoin (money price) losing more than 80% from its historical maximum value in January, the president of Madison does not seem worried at all. He said:
Bitcoin is cheap, which has created a good opportunity for us to enter the market. We are looking at the long term, so we are not worried about short-term volatility.
Ting also stressed that Japan is a particularly appropriate destination for a cryptocurrency trading platform, as it "accounts for about 20% of the bitcoin trade worldwide".
Bitcoinist reported that the Japanese Yen is set to exceed the US dollar in Bitcoin / fiat trading.
In addition, according to the president of the Hong Kong Securities Association, the agreement represents a "small investment" of the company, given its total market capitalization of about half a billion dollars. So, it is not such a big risk for its financial well-being.
However, legislator Kenneth Leung Kai-Cheong urges investors to be careful:
Madison has built its reputation through the trading of fine wines, is a newcomer in the virtual currency industry. Investors must pay attention to the risks that arise when a company operates in two separate business lines.
What do you think of Madison's decision to acquire BitOcean? Do not hesitate to let us know in the comments below!
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